2721 Quail Run #4

Harlingen, TX 78550

$73,000B-

2 bd · 1.0 ba · 780 sqft · Built 1982 · Condo · Pending · 398 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,035/mo
• Mortgage (P&I): −$383
• Tax + insurance: −$144
• HOA: −$0
• Vac / Maint / Mgmt: −$217
• Net cashflow: $290/mo
• Annual: $3,485/yr
• Cap rate: 11.07%
• Cash-on-cash: 17.05%
• DSCR: 1.76
• 1% rule: 1.42%
• Cash to close: $20,440

Investor read

• This is a 2-bed/1.0-bath condo listed at $73k.
• At list price, monthly cash flow is $290 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $73k).
• It's been on market 398 days — a 12% lower offer ($64k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $64k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $505 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 73/100 on livability (#217 in TX) — a middle-class / working-renter tenant base. Strengths: amenities A+, cost of living A+, housing A+; Watch: crime C-, commute F, employment F.
• Harlingen CISD (urban): math 25% / reading 35% proficiency, ranked #647 of 826 in TX (top 78%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 74% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Treasure Hills El (math 24% / reading 37%, grade F, #2,464 of 4,322 statewide, top 58%, 858 students, 72% FRL); Coakley Middle (math 22% / reading 33%, grade F, #1,156 of 1,662 statewide, top 71%, 660 students, 83% FRL); Harlingen H S - South (math 47% / reading 17%, grade F, #1,044 of 1,632 statewide, top 66%, 1,571 students, 75% FRL) — zoned schools at 77% FRL track the district average.
• Market conditions: Rents rising (+3.5%/yr); 468 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); 45% of comp listings sitting > 30 days — soft ceiling on asking rent; 2,326 units permitted in Cameron County in 2024 (503 in 5+ unit buildings).
• Cameron County population projected at +3% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 5 sale attempts since 2y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• At projected returns (-3.0% appreciation + 3.5% rent growth), your $20k cash investment doubles in ~7 years — after that, you're playing with house money.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→25/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 11.1% vs local median 3.8% in Harlingen — top-decile yield for the area; either an underpriced asset or a hidden risk that comps aren't pricing in. Stress-test before assuming the spread holds.

Questions for listing agent

• It's been on market 398 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.
• How much new apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.